The impact of Covid-19 will have a lasting impact on society and business where the services of the Ombudsman for Banking Services (OBS), among others, will be needed more than ever.
The impact of the pandemic on bank issues will only be felt after the dust has settled, said the Banking Ombudsman, Reana Steyn.
The OBS has for the first time released the annual report via a digital platform.
During 2019, the OBS opened 6 472 formal cases and closed 6 333. In 2018, they opened 7 115 formal cases and closed 7 307.
This means there were 9% fewer complaints in 2019 than in 2018.
The number of walk-in complainants increased from 242 in 2017 to a record 326 in 2019.
This may be because more people are becoming aware of our free service, explained Ms Steyn.
A significant decrease in the number of referrals was recorded in 2019 when the OBS referred 4 709 complaints to banks compared to the 6 309 referrals in 2018 and 7 173 referrals in 2017.
“More clients understand that they have to first report any dispute to their bank before they ask our office for assistance,” she said.
Internet banking complaints accounted for 18% received in 2019 – 4% less than 2018.
The office closed 1 292 internet banking fraud cases for the year 2019. About 947 (73%) of these complaints were resolved in favour of the banks and 345 (23%) were in favour of customers. As in previous years, these complaints related to fraud in the electronic banking space.
“Vishing, phishing and smishing, fraudulent SIM swaps are still prevalent and banking clients are still conned into providing fraudsters with their personal banking details,” Ms Steyn said.
“There is a need for continued consumer education and awareness when it comes to this type of fraud and the OBS is committed to helping the banking community provide education and awareness programmes,” she added.
Credit card complaints remained second on the list with an increase to 15% (12% in 2018) of the total complaints received in 2019. A total of 904 were closed by the OBS. A total of 214 (24%) of these cases were resolved in favour of the customers while 690 (76%) were in favour of the banks. The two issues most prevalent were related to card fraud and chargeback disputes due to online trading.
ATM complaints accounted for 821 (13%) cases in 2019, down by 1% from 2018 (14%). The issues also centre on fraud.
As with the other fraud-related complaints, 84% of the cases (694) were resolved in favour of the banks while 16% of cases (127) were resolved in favour of the customers.
The OBS adjudicators had to satisfy themselves that the customer compromised their card and PIN through no fault of the bank, Ms Steyn explained.
Current account complaints accounted for 649 (12%) of the complaints received in 2019 (10% in 2018).
A total of 445 (65%) of these complaints were upheld in favour of the bank while 244 of the complaints were found in favour of the customers.
Personal loan complaints accounted for 666 (11% in both 2019 and 2018), mortgage loan finance for 490 (8% and 10% in 2018), and vehicle finance accounted for 462 (8%) of complaints (8% in 2018).
Debit orders accounted for 190 (3%) (the same percentage as in 2018) of cases received.
There was an almost 50% split with about 48% of the debit order complaints found in favour of bank customers, according to Ms Steyn.
As with the previous year, the bulk of the complaints opened by the OBS are from Gauteng at 44% (42% in 2018), followed by the Western Cape, 15% (same as in 2018), and KwaZulu-Natal 13% (same as in 2018).
The top three complaints per age group received in 2019, were from people under the age of 31 related to ATM fraud, internet banking fraud and to car finance related issues.
Most complaints received from those above 31 but below the age of 40 related to personal loans, internet banking and ATM fraud.
Although there is a slight drop from 2018, the OBS still recorded an alarming statistic of 64.58% of the complainants being from people over the age of 40.
Internet banking fraud comprised most of their complaints followed by credit card and ATM fraud complaints.
“This is an indication that still more measures must be taken to educate this group about the dos and don’ts when it comes to banking,” said Ms Steyn.
The number of formal cases opened against the big five banks in 2019 were: First National Bank saw 1 707 complaints compared with1 560 in 2018; while Absa had 1 483 cases opened against 1 776 in 2018; Standard Bank had 1 127 cases compared with 1 203 in 2018; Nedbank saw 1 094 cases opened against 1 265 in 2018; and Capitec Bank had 763 cases opened against it compared with 1 001 in 2018, statistics showed.
The ombud’s services are free to all bank customers. Visit: firstname.lastname@example.org or call 0860 800 900 or email email@example.com for help and to lodge a complaint.